GDOT & Federal-Aid Highway Financing November 21, 2014 ARC TCC Andrew Heath, P.E., Exec. Asst. to the Chief Engineer Albert Shelby, State Program Delivery Administrator
The Federal Program - Definitions Authorization Act Substantive language that establishes or continue Federal programs of agencies and establishes an upper limit on the amount of funds for the program Appropriation Act Action that makes funds available for expenditure with specific limitation as to amount, purpose, and duration. Amount available to liquidate obligations. Apportionment The distribution of funds as prescribed by a statutory formula provided in law Obligation The Federal Govt s legal commitment (promise) to pay or reimburse State for the Federal Share of the project s eligible costs. Obligation Limitation (Obligation Authority) An annual Congressional restriction or ceiling on the amount of Federal assistance that may be obligated during a specific period of time. Controls the rate at which these funds may be used. (Obligation limitation amount plus the amounts for programs that are exempt from the obligation limitation.) 2
The Federal Program - Definitions Advance Construct (AC) A technique which allows a State to initiate a project using non- federal funds while preserving eligibility for future Federal-aid funds. Eligibility means that FHWA has determined that the project technically qualifies for Federal-aid; however, no present or future Federal funds are committed to the project. After an advance construction project is authorized, the State may convert the project to regular Federal- aid funding provided Federal funds are made available for the project. This can be accomplished as one action, or the project may be partially converted over time. AC is typically used when Obligation Limitation is available but Apportionment has not been provided. The project is fronted with state motor fuel. AC puts pressure on the state motor fuel budget until it can be converted to federal funds using available obligation. 3
The Federal Program Not a traditional grant (cash up-front) program. Reimbursable program. Authorized funding amounts are distributed to the states but no upfront cash is disbursed. Project Approved Work Started State Pays Contractor State Bills FHWA (weekly) FHWA Reimburses Federal Share 4
MAP 21 Short Term Extension H.R. 5021 Highway and Transportation Funding Act of 2014 Extends MAP-21 s program authorization to May 31, 2015 Transfers $10.8B to the Highway Trust Fund $8.8B to the Highway Account $2.0B to the Transit Account Offsets for the $10.8B (savings over a 10-year period) Pension smoothing. Reduces the required level of employer pension contributions which increases tax revenue from less tax-exempt contributions Extended custom fees for one year Transfer from the Leaking Underground Storage Tank Trust Fund 5
Fiscal Year 2015 Federal Funding Situation Authorization & Obligation Extended through May 31, 2015 Approximately 69.32% of expected funds for FY 15 Appropriation Only provided through December 11, 2014 Approximately 19.74% of funds appropriated and available to liquidate obligations Any authorizations beyond this amount must be AC 6
Fiscal Year 2015 Federal Funding Situation 1) Beyond May 2015, there is no certainty of federal-aid transportation funding. As the transportation bill was only extended through May 2015, there are 4 months remaining in the federal fiscal year that are currently unfunded. As such, GDOT does not currently have the federal-aid obligation limitation to continue to authorize PE, ROW, or CST at the typical levels 2) Although Congress extended the promise of funding under MAP-21 through May 2015, actual funding was only provided (appropriated) through December 11, 2014. Federal-aid authorizations are currently being fronted with state motor fuel through advanced construction and will be converted once additional funding is provided. This puts extreme and immediate pressure on the state s budget capacity to continue moving forward with any PE, ROW, and CST authorizations. GDOT is currently on-hold with Federal-Aid Authorizations for FY 2015 PE, ROW, and CST phases 7
Finally Fund Sources The promise of money falls into various funding categories: NHPP National Highway System, M001 STP Flexible M230, M240, etc. TAP M301 SPR M550, M560, M450 HSIP Safety, Railroad Crossing CMAQ M400 Bridge M233 Obligation Limitation must be available in the correct fund category to authorize the project 8
MAP 21 Extension Georgia Obligation Limitation through May, 2015 $777 Million Obligation Limitation ($752M excluding SPR and Rec Trail) ($229M) GARVEE debt service, transfer to transit, lettings through Sept ($40M) NWC ($20M) 285/400 ROW ($26.4M) 285/400 PE ($96M) I-85HOT CST ($4 M) I-85HOT PE ($100M) Advanced Construct Oct Dec lettings ($52.1M) CST Supplemental Agreements to date ($11.8M) Federally eligible IT software and support $172.7M Remaining Obligation* for any PE, ROW, CST authorizations (including SA s) *(when appropriated) 9
Impact to the Program Projects On Hold (Placed on hold due to Lack of Federal Funding ) Proposed Let Month Project Count Estimated Costs (July thru December) 90 $235,710,536 Projects ready to let pending Federal funding to authorize PE & ROW Authorizations also on-hold. Impact to FY 15 Scorecard & Breaking Ground Report 10
Impact of Federal Uncertainty Timeline for Lettings 1 Day Prior GDOT Board Approval 4 Weeks Prior Advertisement Notice to Contractors 5 Weeks Prior Receive FHWA Authorization 10 Weeks Prior Completed Construction Plans* 18 Weeks Prior Submit Corrected Final Field Plans 24 Weeks Prior Final Field Plan Review Held *Projects are being held here due to funding situation It may take time to resume monthly lettings upon resolution of funding situation 11
Get Your Projects Ready Timeline is uncertain as to if/when the funding situation will be resolved Want to be in the best position possible to capture FY 15 funding. Best accomplished by Building a Shelf 12
GDOT Next Steps Continue to educate/inform stakeholders on funding situation through outreach Continue to monitor both Obligation and State Motor Fuel balances for potential authorizations Monitor on-going activity in Washington D.C. Participation in Critical Infrastructure Funding Committee to educate elected officials on funding situation 13
Questions? Andrew Heath aheath@dot.ga.gov 404-631-1927 Albert Shelby ashelby@dot.ga.gov 404-631-1758 14